Have We Finally Hit the Mobile Tipping Point?

Published on April 15, 2016
blog, insights

The "Year of Mobile" has happened and not happened a few times already. As early as 2008, analysts were predicting that mobile would overtake the Internet by 2014. And, now, 8 years later, the same story continues. Last year, digital consumption on mobile surpassed the desktop in the U.S. and a recent study conducted by eMarketer predicted that by 2019, mobile ad spending will account for 72.2% of total digital ad spending. That's a huge hike compared to the 49% mobile ad spending accounted for last year. But, we've heard this story before.
So, what makes 2016's "Year of Mobile" different? Well, there are a few things that really are worth the hype this year.
1. Mobile has become the Superior Engagement Engine
As I mentioned above, for the first time ever, consumers spend more time on mobile than desktop. ComScore's 2015 Global Mobile Report found that the U.S. has the highest skew of usage time towards mobile, with 61% of time spent on mobile versus 39% on desktop. In addition, consumers are spending ~80% of time in mobile apps vs. on mobile web. This challenges advertisers to beef up their resources on app development to ensure functionality is aligned with consumer needs. Mobile usage has become ubiquitous in all aspects of life as people are more comfortable using mobile for just about everything.  E-Commerce has soared (36% of 2015 Black Friday sales were mobile and 57% of traffic was mobile), mobile payments are embedded into most devices, and the Internet of Things is gaining traction with smart watches, smart home security systems, mobile remotes, and mobile assistants all on the rise.  47% of Facebook users only log in on mobile. What does this means for marketers? They can no longer shy away from investing in mobile advertising or they will miss out on a massive part of the consumer journey.
2. Cross Device is Real
Cross device targeting, or people based marketing, is arguably one of the hottest topics in mar-tech today.  The average person owns 3.64 connected devices, meaning a consumer’s path to purchase is not limited to one screen, and ads on one device can influence action on another. In order to effectively communicate with consumers, it is paramount that advertisers have continuous touch points with their target audiences throughout the entire digital journey across all devices.  Unfortunately, because of the multiple identification mechanisms available, it is difficult for an advertiser to track users as they move across screens or even within screens. To overcome this challenge, “device graph” technologies now exist to identify unique users regardless of their device, cookie or IDFA (ID for advertiser).
Scale and audience accessibility are very important when marketers are considering cross device solutions.  The “walled gardens” have clear advantages via their deterministic data.  These solutions are highly accurate, but unfortunately scale is limited to the giants’ user bases and inventory access is limited to their own assets.  Probabilistic solutions leverage probabilistic algorithms to analyze billions of pattern-based data points to associate different IDs and devices to a single person.  These can have massive scale, but are arguably less accurate because they are based on (highly probable) assumptions, not solely on authenticated logins.  However less accuracy, more scale, integration with valuable data sets, and accessibility across the entire web is what advertisers should aim for.  Xaxis has combined the best of both worlds by integrating device graph technology within Turbine and by partnering with walled gardens to provide clients scalable cross-channel capabilities.
A consumer’s path to purchase is not only not limited to one screen, but it is not even limited to one marketing channel, and given today’s technologies bridging the gap is easier. Will an advertiser be able to reach a user with a TV commercial, then find them on their phone, then serve them ad on the smart garbage can and finally see them go into a store to make a purchase? Probably.
3. Location, Location, Location
Where you go tells a lot about who you are.  In today’s modern world, phones are just about vital to existence and people carry them everywhere.  Fortunately for marketers, location data opens up new doors for targeting and measurement because we can tie the lat/long of a consumer’s device to the lat/long of where they are in the real world.
Location enabled ads will account for over 40% of US mobile spend by 2018.  However, targeting someone because they are in a certain location is nothing new- it’s like real world contextual targeting (ex: I am an electronics advertiser, and I target you when you are in an electronics store). What’s more interesting is using location as a data point for behavioral targeting. By tracking consumer movement over time, location patterns emerge, which provide reliable audience signals for advertisers.  For example, a consumer can be identified as health conscious because they frequent yoga studios and juice shops.
Being able to tie a device to a physical location grants opportunities for online to offline attribution. Bringing location data into the fold allows advertisers to connect cross device media exposure to in store foot traffic.  This has become a popular measurement solution for brick and mortar advertisers, especially as a proxy for offline ROI when accurate CRM databases are not available.  With the power of device graph technology and the prevalence of location data, marketers can even connect out of home and digital advertising to in store offline behaviors. Location is at the helm of several other innovative technologies like beacons, trigger based marketing, digital out of home, and location enabled dynamic creative.
It’s safe to say that the “Year of Mobile” is finally here, and the potential of mobile will reach an all-time high for marketers and consumers in 2016. Between the advances in technology for cross device marketing, the general increase in mobile use and mobile e-commerce, and the evolution of location data, 2016 is proving to be the new, the true and the most prominent “Year of Mobile.”

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